FCA Review Finds Weaknesses in Financial Promotion Approval Controls

The Financial Conduct Authority said on 27 May that some firms authorised to approve financial promotions for unauthorised businesses are still falling short of the standard required to protect consumers. In its review of 10 authorised “section 21 approver” firms, the FCA found the strongest businesses were applying the Consumer Duty from the start, making sure adverts were accurate, clear and shown to the right audience.

But the regulator also said some firms approved promotions with unsubstantiated claims or allowed retail investors to see material intended for professional clients. In other cases, approvers leaned too heavily on third-party templates instead of carrying out their own checks. The FCA said one firm has already had to run a remediation exercise and some websites have been blocked for retail customers as a result of its work.

For traders, this matters because high-risk products often reach clients first through online ads, influencer-style campaigns, comparison pages and app-based promotions. If the approval gate is weak, unsuitable products can be presented as more credible than they really are.

Why it matters

The FCA is signalling that “approved” marketing copy is not getting a free pass. Traders comparing leveraged or speculative products should expect the regulator to push harder on evidence, targeting and disclosure standards.

What to watch next

Watch for further FCA supervisory action against approver firms and for tighter scrutiny of promotions tied to retail investment, alternative finance and other high-risk products sold online.